(CNN) -- It was a success story the White House was eager to highlight: Earlier this year, President Obama attended the graduation of 25 police recruits in Columbus, Ohio, touting it as a victory for the federal stimulus package.

On March 6 in Columbus, Ohio, President Obama touted the jobs the stimulus plan would save.

Without the money, the officers never would have hit the streets. They were to be laid off before their first day of patrol, victims of city budget cuts, until the stimulus money saved the class.

But the White House said the $1.2 million grant only guaranteed their jobs until the end of the year. And facing a growing deficit and a fight to pass an income tax hike, Columbus Police on Tuesday announced massive budget cuts that could mean hundreds of layoffs.

Among those who could lose their jobs if voters reject the increase: the 25 new officers who shook the president's hand.

Despite optimistic national headlines on March 6, the day of the president's trip, city officials warned the influx of federal stimulus money wasn't going to be enough to end their financial crisis.

Obama acknowledged in his remarks the money was no silver bullet. "By itself, this recovery plan won't turn our economy around or solve every problem," he said then, and "this police force still faces budget challenges down the road."

The challenges, including a city deficit that could reach $120 million, would mean the loss of 324 officers, more than 15 percent of the force, under a budget unveiled by Chief Walter Distelzweig.

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"This is devastating," he told reporters Tuesday. "None of us signed up for this kind of task."

Distelzweig said under the 2010 budget plan, the department will focus on priority calls and maintaining public safety. "Policing in this city will change as we know it today," he said. " ... [We're] going to do less with less."

He stressed the cuts are not final, and city voters are being asked to approve an income tax hike in August. The half-percent increase, if passed, could avoid the firings and furloughs. Distelzweig said the announced cuts are not meant to be a threat to voters. "It's math -- whatever money is available," he said.

Columbus is not alone, of course, in its budget crisis. To its south, Cincinnati is looking at job cuts and reduction in services because of a higher-than-expected deficit. Smaller cities such as Mansfield, 60 miles to its north, have been forced to lay off up to a third of its officers. CNNMoney.com this week reported 16 states around the nation have raised taxes this year, with proposed increases in 17 others.

Looking at the graduates receiving their diplomas that day, Obama said, "This economy needs your employment to keep it running."

"I look into their eyes and I see their badges today, and I know that we did the right thing," he told the crowd on March 6. "These jobs and the jobs of so many other police officers and teachers and firefighters all across Ohio will now be saved because of this recovery plan."

The grant did its job and funded the class for a year. But local budget problems took over. And the 25 officers, a hopeful symbol that day for the White House, may turn into a grimmer example of financial realities still facing communities around the country.